State Seeks to Reopen Done Deals

After winning hefty pay hikes and other benefits in recent years, some state employees soon could face a reversal of fortunes.

Lawmakers are questioning the cost of a deal that former Gov. Gray Davis’ administration made with state prison guards -- some of his biggest political donors -- and are scrutinizing the process by which governors bargain and legislators ratify such contracts.

Atty. Gen. Bill Lockyer’s deputies are challenging a clause in the guards’ contract that gives them broad protections when they become targets of internal investigations.

And earlier this month, a Superior Court judge blocked a key provision of a contract with Caltrans engineers -- and of pacts with other state employee unions -- restricting the state’s ability to hire private firms. State employee unions generally oppose the use of private contractors; they threaten state jobs.

Additionally, the Legislature’s chief attorney issued an opinion this month casting doubt on the legality of multiyear labor pacts that promise state workers automatic raises year after year.

The legislative counsel’s opinion concerned a contract with the California Correctional Peace Officers Assn., which represents state prison guards, but it also could apply to state firefighters, California Highway Patrol officers and engineers with multiyear contracts promising them boosts in pay and benefits.

“There’s a groundswell against CCPOA that could affect us all,” said Jon Hamm of the California Assn. of Highway Patrolmen.

Annual raises cannot be granted unless the Legislature makes annual allocations for them, the legislative counsel said. And with the state facing a $14-billion budget shortfall, lawmakers and Gov. Arnold Schwarzenegger are choking at the prospect of an automatic raise for correctional officers estimated at 11.3%.

Under the guards’ contract, the pay hike would come in July and cost $230 million. The guards received a 6.8% raise last July.

Highway Patrol officers, who agreed to forgo 5% of their raise last year, stand to receive the 5% in July, plus the 7.1% increase they are expected to get the same month under the terms of their contract. Their combined 12.1% pay hike would cost $113 million per year, according to the state Department of Finance.

Firefighters would receive overtime increases costing about $14 million.

“Arithmetic is bearing down on them,” said political science professor John Pitney Jr. of Claremont McKenna College. “That pay has to come from somewhere, and that means making cuts elsewhere or raising taxes. That ... takes some of the zest out of giving raises.”

Schwarzenegger rejects money from public employee unions. Davis, by contrast, was negotiating with some of his biggest patrons when he forged the labor pacts.

State prison guards, engineers, Highway Patrol officers and firefighters unions representing 54,000 state employees contributed nearly $2.6 million to the Democratic governor during his five years in office. That sum included $1.4 million from the correctional officers.

The state engineers gave him $582,000 -- including $80,000 Sept. 25 and $150,000 Sept. 27, 2003. Davis signed their contract into law Sept. 29. A week later, he was ousted in the Oct. 7 recall.

Bruce Blanning, executive assistant for the 13,000-member Professional Engineers in California Government, declined to discuss the Davis donations.

Steve Maviglio, who was Davis’ press secretary, said there was “absolutely no connection” between the September donations and the former governor’s decision to sign the contract.

“There was a big wall constructed between union negotiations and the campaign,” he said.

Lawmakers, for the most part, have focused on the prison guards’ package. Sen. Jackie Speier (D-Hillsborough) and Sen. Gloria Romero (D-Los Angeles) -- both traditionally allied with organized labor -- have delved into the five-year pact with the 31,000-member union as part of oversight hearings on the prison system.

The deal, struck as Davis entered the 2002 reelection campaign, granted prison officers long-sought parity with the Highway Patrol and major urban police departments. The Legislature ratified the deal with only one “no” vote. Speier and Romero voted for it.

Depending on raises granted to local police in Los Angeles and elsewhere, prison officers’ pay could rise by 37% by 2006, to an annual salary of more than $73,000 a year for a veteran guard. The Schwarzenegger administration recently estimated the combined cost of the deal at $2 billion. The Davis administration in 2002 had placed the price tag at $521 million over the life of the contract.

“The Legislature is embarrassed about how it let these hastily approved contracts take place,” said Sen. Bruce McPherson (R-Santa Cruz), who sits on the prison oversight committee. “The cost factor

Romero, meanwhile, criticizes the concept of linking state employees’ pay to higher-paid counterparts in cities and counties. By agreeing to such a pay structure, the state cedes control of salaries to boards of supervisors and city councils.

“Local entities tell us what to do,” Romero said. “We have no control.”

Still, Romero goes out of her way to emphasize her fealty to organized labor. Senate President Pro Tem John Burton (D-San Francisco), who carried the 2002 bill ratifying the guards’ deal, said a “contract is a contract.” By questioning the package, Burton said, legislators are opening a “Pandora’s box.”

“How do you not reopen every contract?” he asked.

Executives in the correctional officers union, and those representing Highway Patrol officers and engineers, defend the deals, saying their members agreed to forgo pay raises in the first two years of the five-year contracts to help the state weather tough budget times in exchange for the promise of raises in the final three years.

“If the Legislature ever refused to appropriate money in a labor contract, there would be litigation,” said Blanning, who represents Caltrans engineers, who struck their deal with Davis in the final days of his tenure last September.

Blanning estimated that engineers’ raises, which could kick in next year, could amount to 30% by the time the contract expires in 2008, depending on the outcome of a salary survey.

Pay is not the only issue. The contract with prison officers requires Department of Corrections internal affairs investigators to inform officers within 24 hours if they are subjects of probes and provide them with copies of investigative material.

The issue came to a head when investigators looked into allegations that officers abused inmates at Chino state prison in 2002, and the officers union representatives demanded the investigative files. Investigators refused to turn them over, saying that would compromise their work. A state arbitrator is considering whether the officers have a right to the files.

Deputy Atty. Gen. Howard Moseley, testifying before Speier and Romero this month, said the contract gave guards protections that exceeded those given to police. And he said it violated other state laws, including one requiring that investigators protect the identities of confidential informants.

“Collective bargaining is limited by statute to workplace issues, not what are deemed to be managerial issues,” Moseley said. “How a criminal investigation is conducted within the Department of Corrections is not something they can negotiate away.”

Lance Corcoran, executive vice president of the prison officers union, said that although it was expanded under Davis, that section of the contract dates to 1987 and “has never presented a problem or an obstacle to investigations.”

Private engineering firms raised similar issues regarding the state engineers’ contract, alleging that the Davis administration overstepped its authority by seeking to limit the state’s power to contract with outside firms. An initiative approved by voters in 2000 expanded private engineering and architectural contractors’ right to do state work.

In what private engineers viewed as an attack on the initiative, the contract that Davis signed with state engineers said the state must “make every effort to hire, utilize and retain [union] employees before resorting to the use of private contractors.” It also required that the state establish union-management committees that could review and terminate outside contracts, even if it meant hiring additional state workers.

Superior Court Judge Raymond Cadei of Sacramento County issued an injunction this month blocking that part of the engineers’ contract from taking effect, pending a full-blown hearing later this year.

The Schwarzenegger administration has joined the suit on the side of the private firms, and has told other unions that it is placing any use of the provision on hold pending the outcome of the litigation.